The world's most prolific search engine will soon be available to the public–the stock-buying public, to be exact. Google.com filed with the U.S. Securities and Exchange Commission (SEC) for an Initial Public Offering (IPO). The Internet search firm felt the timing was right for going public, with economic prospects worldwide starting to look up.

Google represents the antithesis of the dot-com bust era. Unlike many Internet-only firms, Google actually turns a profit. And a tidy profit it is, with Google reporting 2003 revenues of US$961 million and a profit of $105.6 million for that same period. Google started off 2004 with a bang by beating its own earnings estimates, pulling in a $64 million profit in the first quarter alone, doubling the figures of the previous year's quarter.

Google expects to raise $2.7 billion via this offering. Google may need the cash before long. Stiff competition is expected between Google and former partner Yahoo!, which discontinued its search engine sharing contract with Google last year.

ERIC'S OPINION
This should come as a shock to no one, as rumors of Google's IPO have been rampant for some time. The full details of the IPO are not completely public yet, but I'm willing to bet it's going to be one of this year's hotter stocks to watch. Internet companies that are (a) large, (b) profitable, and (c) well-managed are not common. The Information Superhighway is littered with the roadkill of dead dot-coms, each of which had a “grand plan” usually resting more on smoke and mirrors than substance. I know some poor fools who still have their Pets.com shareholder certificates. And let's not forget Webvan.

Where is Google going from here? That's the big question on everyone's mind. Although Google is a fantastic search engine, it prides itself on being a stripped-down, no frills experience for those interested in finding what they want on the web. This limits Google's ability to add other services, services that keep rival Yahoo!'s website, which is chock full of stuff in every square inch of browser real estate.

Ad revenues can only take Google so far, so I'm sure The Sreet will be anxious to hear exactly how Google expects to grow its business model.

USER COMMENTS 23 comment(s)

…and may change how Wall Street deals with IPOs(11:59am EST Fri Apr 30 2004)No flipping stock, less inflence from public shareholders. Google is the only large company who can demand these unusual conditions and get away with it. Hopefully it will stick. – by Small Fry Investor

A fool and his money ….(12:00pm EST Fri Apr 30 2004)What are you 'really' buying? Some space on a hard drive, really. That's it.

I lost $25,000 on Buy.com why? I was a fool. I bought a store without anything tangible. The whole .com baloon burst because unlike buying IBM, AMD, INTC, WAL and everyone else you are not buying property, patents, materials, or goods. No, you just own a few bytes on a hard drive.

If you can get in early and make a few bucks good for you. Would I bet my retirement on it? Not this person. – by Hodar

To Hodar(12:49pm EST Fri Apr 30 2004)Google has an impressive patent portfolio, as well as a solid history of PROFITS. At least two good reasons to get on board.

Secondly, their public structure will keep company run by the people who have made it profitable, not a bunch idiotic, 'make me rich', share holders.

You bought BUY.com on speculation, not fundamentals. I really don't feel bad for anyone who lost money on dot com stock. If you had read the fundamentals and not got carried away with the POTENTIAL for future profits, you wouldn't have touched those stocks with a ten foot pole. Or at least not with money that you could not afford to throw away.

Go Google. – by Guinea Man

RE: Hodar(12:55pm EST Fri Apr 30 2004)While I share your general skepticism in these things, the traditional reliance on tangible “bricks and mortar” asset companies for stock buys is showing signs of age. Never forget that plenty of “tangible” product companies have gone belly-up in the last few years, dot-com or no dot-com.

My personal opinion on this (thanks for asking!) is you need to look for firms with a good business plan, a solid management team, and a good growth market. If you have those three essentials, the odds of success are greatly improved over the alternatives.

Is Google.com a good investment? Read their prospectus and decide for yourself. Don't dismiss *any* stock simply because other somewhat similar companies have failed. After all, those who took a chance on investing in MSFT almost thirty years ago are relaxing near their private island on their luxury yacht sipping mint juleps. – by J. Eric Smith

Re:J. Eric Smith(1:43pm EST Fri Apr 30 2004)Ah, but there's the rub. M$ sells a series of products. People buy these products, in fact people wait until mid-night to be the first geek on the block with the latest release of the product.

Google is free. The only revenue stream they have is ad-space. Now rumor has it that there are competitors out there, besides Google. Google became popular by virtue of how they did business. Yahoo had the lead and Alta Vista, and Dog Pile, Ask Jeeves and others are all competing. The line forms to the left.

Now Google is adding free email with the caveat that they reserve the right to scan your email, then target you with specially selected SPAM.

I'm not saying that no one will make money with Google. I'm not saying that Google is a bad buy. I am saying that unlike “Brick and Mortar” stores, Google does not have poperty, buildings, goods and services to leverage off of.

Hey, it's your money. I think I'll keep mine near AMD, DELL and CRAY. They have done pretty well by me in the past and I see no downside in the foreseeable future. But, your crystal ball is every bit as clear and concise as mine. – by Hodar

Their strength will be in their client base and their exposure like any ad company. Of course it is less concrete than physical assets but if you are really so concerned about such things I would think you should get out of the market and buy real estate.

The thing is it is a very good time for them to go public, I think it is well planned. Whether or not their stocks will be a great investment remains to be seen but it has little to do with the lack of brick and mortar. – by CD

Hey Eric(2:21pm EST Fri Apr 30 2004)What the heck is

The Sreet??

Tai Food?

LOL – by Dinobot

Hodar(2:58pm EST Fri Apr 30 2004)Google sells it's services as well. Yahoo is based on google's search engine, and they pay them for the service (at least they were, I think Yahoo started doing it themselves?). – by Etcetera

I'll buy some, just not for long(7:33pm EST Fri Apr 30 2004)Eric, fundamentals haven't been good short term predictors of stock movements in the last 5 years. But hype and uncertainy have moved them a lot, many multiples in many cases.

If your activly trading right now your trading on hype and uncertainy. Some of the companies with the best fundamentals aren't trading worth crap these days. But float a rumour and watch them go (up, down, and sideways). Myself and several of my friends still day trade with small money $10k-$20k, no more. It's no way to get rich but it's fun and you get to tell lots of stories about your good/bad guess's.

The last IPO the had as much hype as Google was Netscape 10-12 years ago, it tripled on day one. It eventually crashed and died for good reasons, but before it did a lot of people got rich.

When Netscape IPO'ed we were just coming out of a recession about like the one we're coming out of now. Just like that one the semiconductor boys led the way down and then up. The fabs are almost full right now, DRAM's going up, feels kind of the same to me.

I think I'll take a chance that Google is a Netscape rerun, maybe I'll be a lucky bastard, maybe I'll be a dumb one. Either way I'll have a good story to tell… – by darwinism

Oh yeahhh…(8:12pm EST Fri Apr 30 2004)I'd be less inclined to buy Google if it weren't for the expansion it is *attempting* ie: its free e-mail not to mention rumours that it may even make its own “rental” PCs. I wouldn't buy a Google PC but I'm sure the people who casually bought IMacs would. If you could buy a hypthetical that was just for Hotmail would you make money? Of course. I'll put a few grand on it and see where it goes. I'm no dummy. – by Vorlon

Search engine…(1:12am EST Sat May 01 2004)It will be interesting to see if advertisers continue to pump money into google now that Yahoo no longer uses them…

It's a search engine… with ad sales… M$ is entering the space as well…

The good 'ol days are over for Google… no more free rides. – by lotsofhype

I use Google for all my searches,(8:30am EST Sat May 01 2004)but search engines are a dime a dozen. Somebody will do it better or different, or in such a way as to make Google irrelevant. The more money Google makes, the more enticing it will be for others to enter the competition.

Google sells services, but their whole model, insofar as I can tell, is built on sand. They're a very good company with smart people at the helm, but their tangible fvalue, in my view, is a couple of zeros lower than what they're hoping to raise in their IPO.

I hope they realize their expectations for raising money, and I hope their investors don't get burnt in the end, though I expect they will. – by Tall Timbers

RE: J. Eric Smith(1:52am EST Sun May 02 2004) I have to cpmp[letely disagree with you. Very few people like mint juleps. – by Bovinefeces

Of course Google went IPO now,(2:25am EST Sun May 02 2004)since Microsoft is entering the search business with Longhorn, it's best to quit while they're still ahead. Smart move for the execs, but bad for the investors. Another dotcom bust IMHO. – by Burnt Investor

google stock(11:47pm EST Tue Jul 27 2004)I've learned a lot just from reading all of your comments. I'm single mom of three. Would like to get a few shares of google. My gut tells me to ride the wave a little bit. First sign of trouble bail out. Does this sound reasonable? I've always played it safe with bonds, cd's and low risk mutual funds through Fidelity. What do you think? – by Sheila